CMS price transparency rule ‘likely insufficient’ in current form
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The 2019 CMS price transparency rule did not result in uniform publication of hospital chargemasters across various NCI-designated cancer centers, according to study results published in JAMA Oncology.
“We identified a wide variation in listed prices for cancer treatments among NCI-designated cancer centers, which were also hard to find,” Trevor J. Royce, MD, MS, MPH, radiation oncologist in the department of radiation oncology at The University of North Carolina at Chapel Hill, told Healio. “The CMS policy likely has limited practical value and does little to improve price transparency for consumers. The listed prices are unlikely to be reliable enough to facilitate comparison shopping or drive price competition, thus, the rule in its current form is likely insufficient.”
Price transparency is one proposed approach to reduce the high costs of cancer care. The CMS finalized a rule requiring all hospitals to publicly publish their chargemasters by January 2019, allowing patients to research and compare costs for cancer treatment services across cancer centers.
However, chargemaster list prices can differ substantially from the actual final payer-negotiated payments and consequent out-of-pocket costs for patients.
Royce and colleagues sought to examine whether the CMS rule allows men with prostate cancer to comparison shop for cancer treatments based on price, with a specific focus on the variability of costs for intensity-modulated radiation therapy.
“We used patients with prostate cancer as an example because these patients often have various treatments and seek second opinions at different institutions, but the results can be applied to other patients who need radiation therapy, as well,” the researchers wrote.
Researchers pooled data on publicly available price-containing chargemasters from 63 NCI-designated cancer centers in February 2019. They isolated charge-per-fraction of IMRT used in standard prostate radiation treatment and calculated the mean charges of a 28-fraction course of prostate irradiation, which they compared with costs paid by Medicare.
Overall, 52 centers (84%) publicly listed standard costs for IMRT, whereas three centers (5%) did not have a chargemaster available and eight centers (13%) that had a chargemaster available did not list the cost for IMRT.
Researchers observed significant variations in publicly listed costs, with charges that ranged from $18,368 to $399,056 for a standard 28-fraction course of irradiation treatment, corresponding to a 21.7-fold difference in costs between the least and most expensive cancer centers.
Moreover, the mean publicly listed price of $111,729 was 10.1 times higher than the $11,091 price paid by Medicare.
When the researchers plotted the association between radiation price and hospital geographic practice cost index, results showed a weak positive Pearson correlation, with an r² value of 0.13 (P = .008).
Limitations of the study included the fact that it did not account for various other radiation and ancillary services delivered and billed before or during the course of prostate cancer treatment that affect total cost of care. Additionally, the quoted costs of care may differ from listed prices.
“We will continue to study policies that promote price transparency and their effectiveness in doing so, including the two new rules that CMS instituted on Nov. 15 to increase health care price transparency,” Royce told Healio. “The Price Transparency Requirements for Hospitals to Make Standard Charges Public final rule requires hospitals to publicly post standard charges for 70 specific services in addition to 230 hospital-identified services.
“The hope is that this better facilitates price competition,” he added. “However, it is not clear when this will be implemented, as several hospital groups have filed a lawsuit against the U.S. Department of Health and Human Services in federal court regarding this rule.” – by Jennifer Southall
For more information:
Trevor J. Royce, MD, MS, MPH, can be reached at The University of North Carolina at Chapel Hill, 101 Manning Drive, CB7512, Chapel Hill, NC 27599; email: trevor_royce@med.unc.edu.
Disclosures: Royce reports no relevant financial disclosures. Please see the study for all other authors’ relevant financial disclosures.
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